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Annual Information Session: Northwestern Accounting
Evanston ChicagoAugust 7th, 2019 August 13th, 2019
Norris University Center, Rm 202 Arthur Rubloff Building, Rm 140
Agenda
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Topic Presenter
Chartfield Maintenance Reginold George (Evanston)Amy Mykytiuk (Chicago)
Gifts and Endowments Lauren Armstrong
Tax and Regulatory Services Shereen OlickalShawn Cabinian
Depository Services Cindy Regner
PCI Compliance Marci LaRouech
Journals and Reporting Lauren Armstrong
Chartfield Maintenance
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Topics – Chartfield Maintenance
I. Chart of Accounts (COA)
II. New Requests
III. Inactivations
IV. Frequently Asked Questions (FAQs)
V. Resources
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Chart of Accounts
The Chart of Accounts (COA) is a string of informational fields that identifies, segregates, and categorizes transactional and budget data. It provides the organizing framework for both financial and management reporting.
Chartfields are individual valid values (e.g. Fund) used in unique combinations called chartstrings (e.g. Fund + Department) to capture data for management and financial accounting.
Chartfield Maintenance is the activity of managing the structure of the COA and establishing the values used to record financial transactions.
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Chart of Accounts - Chartfield Values
The Fund code is the first three digits of a chart string and indicates the type of funding for a transaction or budget. Examples: 110, 320, 450, 610
The Department ID (seven digits) identifies the financial entity or management unit that is responsible for the activity. The first two digits identify the grouping of units within which DeptIDs belong. This is different than the 6‐digit HR Department ID.
The Project ID (eight digits) is used to identify financial activity for a distinct unrestricted or restricted purpose. The first digit of the Project ID typically matches the fund.
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Chart of Accounts - Chartfield Values
The Activity ID (two digits) is required when a Project ID is used. Generally, 01 is used. Some Grants and Plant projects may use other codes to represent year or phase.
The Program Code (four digits) can be used to unite collaborative activities across units to provide multiple users access to reporting.
The Chartfield1 value is for activity within the individual unit to provide more specific reporting and analysis.
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Chart of Accounts - Chartfield Values
The Account Code (five digits) classifies a transaction as revenue, expense, or balance sheet.
Most commonly used account groupings:
40000’s Revenues (from external entities)
50000’s Internal revenues (intra-university sales)
60000’s Personnel Expenses (e.g. salary and benefits)
70000’s Non-personnel expenses (e.g. services and supplies)
80000’s Transfers (intra-university movement of funds)
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New Requests
Anyone can submit the Chartfield request to update or add a new value through NUFinancials. Request a new Chartfield value when existing values do not capture unique financial activity for appropriate monitoring or financial accounting purposes. Please review existing values prior to submission.
All chartfield request goes through the workflow approval and are approved by a registered department/unit approver. Workflow is viewable within the chartfield request.
To become a registered approver, submit a security form to FOIT:https://www.northwestern.edu/controller/financial-operations-it/ffra-security-forms-and-reports/index.html
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New Requests - NUFinancials
To be notified, your email address must be included on the notification list in question 3, even if you are the requestor.
Attach support for the request to assist approvers in understanding the intent.
Approval workflow is viewable in the request via hyperlink.
Update a project manager via Manager/Attributes tool, not Chartfield Request. Managers must be active in FASIS.
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Inactivations
Chartfield value (i.e. project, department):• ChartField value must have zero balance for any
combination.• Inactivations valid as of date approved – no future dates.
Chartstring (i.e. Fund + Department):• Does not inactivate use on any particular value, only use
of the combination of values.• ChartString must have zero balance.• Submit excel template to Chartfield Maintenance –not
requested via NUFinancials tool. • Processed quarterly.
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FAQs: Budget
Who sets up a budget?
A budget will be established by the chartfield request process upon chartfield set up. Future changes are handled by the department and/or the Budget Office. If a budget was not created during the set up of a new project, contact Chartfield Maintenance for support.
What if I don’t want a budget attached to the chartfield?
When submitting a chartfield request, there is a required field to select a zero-dollar budget, specific budget, or no budget.
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FAQs: Reporting
Why can’t I view the chartfield in a report?
Users must have security access to their unit or applicable range of values to view related chartfield values. Financial Operations IT assists with security access updates.
Why does an inactive chartfield still appear on my report?
Values will remain on reports until the next fiscal year. You may filter out inactive values when pulling reports.
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FAQs: Errors
Project ID does not exist:
Common processing issues are:
• Incorrect fund used
• PC Business Unit not filled out in the transaction
If you encounter additional errors, reach out to Accounting Services.
Invalid Combo Error:
If the combination of chartfields is correct, reach out to Chartfield Maintenance. Set up errors may exist.
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Resources
Chartfield Maintenance Resources
https://www.northwestern.edu/controller/accounting-services/chartfield-maintenance/resources-forms.html
Chartfield Email
Financial Operations IT Security
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Gifts and Endowments
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Topics – Gifts and Endowments
I. Types and Restrictions
II. Endowment Operations
III. Compliance
IV. Resources
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Types and Restrictions
Gift Type Example
Without Donor RestrictionGifts that can be used for any purpose
“without further restriction,” or
“to support scholarships at the KelloggSchool of Management”
With Donor RestrictionGifts a donor identifies to be invested and held in perpetuity with only the investment returns available to be spent, or
Expendable gifts with a time or purpose restriction
“to establish an endowed fund to be known as XYZ Foundation Fellowship Fund… expendable income from the fund shall be used to provide support for a fellowship in Hematology/Oncology,” or
“to support seminar series up to $5,000 per year”
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Types and Restrictions - Designations
Designations are instructions related to the spending of gifts without donor restriction and income earned from an endowment.
Restriction asks: Can you spend the gift?
Designation asks: Yes, you can spend the gift. How do you spend it?
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Types and Restrictions - Endowments
True Endowment (Permanent)• Established by a donor-restricted gift• Original gift value preserved• Spending distribution provides an ongoing stream of
funds
Quasi – Endowment• Funds Northwestern internally treats as an
endowment, without legal obligation to do so• Principal may be spent in accordance with
Northwestern policy and procedure.– Requests for activity related to principal must be approved
and processed by Accounting Services and Budget Office.– Three-year rule to invade principal
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Endowment Operations
Endowments provide Northwestern with a significant and permanent source of funds to support professorships, research, financial aid, capital projects, Schools, Departments, Institutes, Centers, and more.
Endowments impose contractual, legal, ethical, financial, management, and reporting responsibilities.
Proper management and administration of our endowment accounts maintains and enhances the confidence of Northwestern’s constituents, especially donors.
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Endowment Operations - Reporting
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Fundriver reporting, income distribution schedule, and unit price links are available on the Accounting Services website.
Endowment Operations - Chartfield Requests
Gift Acceptance and Fund Management will email your school or department with directions when a new project can be established.
• Gifts may only sit in a TBD account (460) for up to 90 days. Gifts will not earn income while in fund 460.
Accounting Services processes endowment terminations and inactivations in Fundriver and the general ledger. Effective dates may vary due to Fundriver schedules.
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Endowment Operations - Spending
Gift Acceptance and Fund Management will email your school or department with directions when an endowment is eligible to spend on income earned.
Your responsibilities:
– Confirm department ID is correct
– Connect with budget analyst to establish budget journal
You do not need to submit a Chartfield request to create a spending chart string.
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Compliance – Your Role
• Familiarize yourself with donor documents and restrictions of all funds within your department.
• Distribute fund memos as necessary.
• Ensure expenses comply with designations and whenever possible, are directly charged to the spending account.
• Monitor fund balance for deficits or surpluses.
• Assist with the preparation of any donor reporting.
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Compliance – Monitoring Balances
Deficits must be covered by moving expenses to another chartstring.
Spend regularly! It is recommended that chartstrings do not exceed a surplus carryforward of over two years’ worth of distributions.
Consult with your Dean or Vice President’s Offices to develop a spending plan. The Budget Office can provide additional support upon request. Options include:
– Support the next fiscal year’s activities
– Commit the funds for the future planned and approved programs that conform to donor restrictions
– Reinvestment: consult with a budget analyst and Accounting Services
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Compliance – Risk
The risk of non-compliance is serious.
• Lawsuits and investigations
– Initiated by Attorney General
– Private Right of Action
– Regulatory Entities
• May be forced to return funding
• Jeopardize opportunities for future gifts
• Damage to Northwestern’s institutional reputation
• Damage relationship with donor
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Resources
Gift Acceptance & Fund Management Box
• FAQs and job aids
• Process overviews
• Roles and responsibilities
• Sample memos and agreements
Accounting Services Website:
• Monthly endowment unit price
• Endowment close schedule
• Access request forms
• Training materials and job aids
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Resources – Systems and Reports
Fundriver is a web-based administration application designed to manage, track, and report on endowment funds.
CATracks is a web-based donor management system designed to manage, track, and report on gift transactions.
GL062 reporting in Cognos.
Fund Memos and Gift Agreements in OnBase.
When in doubt, reach out to Gift Acceptance and Fund Management and Accounting Services.
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Resources – Access Request
Fundriver – submit form to Lauren Armstrong. Requires supervisor approval.
CATracks – submit access and confidentiality forms to ARD User Services. Requires an ARD sponsor and user training.
OnBase – contact ARD Information Management.
COGNOS/NU Financials – submit form to FOIT.
Fund Memos – new, amended, and terminated memos sent to primary contact within school/unit monthly, who distributes to appropriate departments.
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Resources - Contacts
Accounting ServicesLauren Armstrong: 847-491-4468, [email protected]
Accounting Services: [email protected]
Alumni Relations & DevelopmentGift Acceptance & Fund Management: [email protected]
Gift and Records Services: [email protected]
Office of Budget and PlanningAnalysts are designated to specific departments, see organization chart here:
https://www.northwestern.edu/budget/contact/index.html
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Tax and Regulatory Services
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Topics – Tax & Regulatory Services
I. Tax-Exempt Status
II. Form W-9
III. Form 1099-MISC
IV. Sales Tax
V. Resources
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Tax-Exempt Status
• Northwestern University* is exempt from certain, but not all, federal, state, and local taxes as a registered 501(c)(3) tax-exempt organization with the IRS.
• Northwestern’s “tax-exempt purposes” are the education of current Northwestern students and research.
* Northwestern Memorial Hospital is a separate 501(c)(3) tax-exempt organization from Northwestern University.
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Tax-Exempt Status - Revenue from External Customers• Our income tax-exempt status does not always apply to
revenue from external customers*.
• Contact us if:
– Renting space or equipment to external customers.
– Earning revenue from international (non-U.S.) customers.
– Consulting to companies where income earned by Northwestern.
* External customers include anyone who is not a currentNorthwestern student, staff, or faculty member.
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Tax-Exempt Status - Charitable Donations• Using Northwestern funds to donate to another
501(c)(3) charitable organization or fundraise on behalf of another charitable organization requires pre-approval from the Senior Associate Vice President for Finance.
• Northwestern funds cannot be used to support:
– Political activities
– Foreign (non-U.S.) organizations
– Non-501(c)(3) organizations
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Form W-9
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Form W-9 provides the requestor with a business’ or individual’s:
• Legal name
• Legal address
• Tax classification
• Identification number
– SSN from individuals
– Employment ID number (EIN) from businesses
Form 1099-MISC
• Form 1099-MISC reports total calendar year payments from Northwestern to non-Northwestern parties.
• Payments to individuals for services or research participation over $600* in calendar year, not including reimbursements.
* Includes all payments made via A/P checks, cash, and/or stored value cards.
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Form 1099-MISC - Your Role
• Although most 1099-MISC information is provided by the Accounts Payable department, keep track of this information in your unit in case issues arise:
– Name of individual or business
– Current legal address
– Payment amounts and dates
– Social security number or employer ID number (EIN)
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Sales Tax - Purchasing
• When purchasing a good or service from a vendor, Northwestern is exempt from certain taxes, including sales tax imposed by some states.
• Contact Procurement and Payment Services by email at [email protected] to obtain documents or certificates relating to Northwestern’s sales tax exemption status.
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Sales Tax - Selling
Is your department or school:
– Selling items to customers outside of Northwestern (e.g., not current staff, faculty, or students)?
– Selling items online?
– Selling items to customers located in Illinois? Michigan?
Please contact Tax & Regulatory Services to discuss sales tax compliance.
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Resources – Useful Documents
• We can provide these documents upon request:
– IRS Letter of determination (“501(c)(3) letter”)
– IRS Form W-9 for Northwestern University
– IRS Form 990 and 990-T
– Illinois Certificate of Good Standing
– California Form 590
– Certificates of U.S. Tax Residency (Form 6166)
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Resources – Issues & Departments
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Issue Department
1099-MISC; IRS documents;sales tax (when selling); 990; UBI
Tax and Regulatory Services
Student tuition (and 1098-T) Student Finance
Sales tax exemption certificates (when purchasing)
Procurement and Payment Services
Contract review Office of General Counsel
Questions from registered undergraduate student organizations
Evanston - Student Organization Finance Office (SOFO)Chicag0 - Chicago Organization Finance Office (COFO)
Resources
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Contact Tax & Regulatory Services
Website https://www.northwestern.edu/controller/tax/
Email Address [email protected]
Phone Number (847) 467-4210
Policies and Forms
All Policies https://policies.northwestern.edu/all-policies/university.html
Request Form To Provide Donations to or Fundraise for a Registered Not-for-Profit Charitable Organization
Policy - Donations Charitable Donations by the University
Policy - Fundraising Fundraising for Other Charitable Organizations
Depository Services
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Topics – Depository Services
I. Wires
II. Cash Receipt Tickets (CRTs)
III. Fiscal Year End
IV. Resources
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Wires – Incoming and Unidentified
• Notify Evanston Depository Services if expecting any incoming wire/ACH
• Amounts may be slightly different than you expect:
– Bank fees applied against revenue
– Foreign currency conversion is applied if wire not in USD
• Refunds and overpayments may be returned as a wire
• Missing a check? Ask if it was sent as a wire/ACH
• Visit our website for a list of unidentified wires: www.northwestern.edu/controller/treasury-operations/depository-services/index.html
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CRTs – Creating and Committing
• When creating a CRT, Dep Ref ID to match deposit slip
• You can “uncommit” a CRT if change needed– If the CRT is already posted you must create a journal
• CRTs must be committed to post– Revenue is not applied if CRTs are only ‘saved’
• CRTs need to be voided; they cannot be saved
• Credit card CRTs auto-commit in 5-7 business days
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Fiscal Year End – Reminders
• Friday, August 30th 2019
– Depository Services must receive bank deposit bags by 11:30am
– Remote check deposits must be completed by 5:00pm
– CRTs with Media Type “checks/cash” committed by end of day
• Friday, September 6th 2019
– Credit card CRTs committed by end of day or auto-committed
– Wire CRTs committed by end of day
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Resources
Depository Services
https://www.northwestern.edu/controller/treasury-operations/depository-services/index.html
Cash Receipt Ticket (CRT) Questions
o Cindy Regner: [email protected] | 847 . 467 . 6327 (Evanston)
Missing Wire or ACH Revenue?
o Yan Shen: [email protected] | 847 . 491 . 4691
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PCI Compliance
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PCI Compliant Payment Solutions
• Arrow Payments is Northwestern’s payment solutions consulting partner– E-commerce
– In-person
– Mobile
– Over the phone
– Software integrations
• Merchant Account (MID) set up
• PCI Validated P2PE Device – ordering, installation, training
• Annual PCI Self-Assessment Questionnaire (SAQ) Support provided by Arrow Payments
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PCI Compliant Payment Solutions
Arrow Payments
312-829-1200
Accounting Services E-commerce Resources
https://www.northwestern.edu/controller/treasury-operations/e-commerce-operations/index.html
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Journals and Reporting
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Topics – Journals and Reporting
I. Types
II. Processing
III. Cognos Reports
IV. Resources
V. Important Dates
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Types
• Types are related to account codes utilized in journal
– Correction
– Internal sales
– Transfer
– Agency
– Balance sheet
• Methods for journal entry
– Automated system interfaces
– Portal transactions with workflow
– Spreadsheet uploads
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Processing
• Include attachments to support transactions.
• Delete journals at month end if denied or not fully approved.
For more information, please visit: https://www.northwestern.edu/financial-operations/policies-procedures/finance/financejournalprocessing.html
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Processing - Modification
Add/Update Actual Journal Search for journal and open
Modify:
Delete:
Confirm:
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Processing - Journal Workflow
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Cognos Reports
• GL005 – Summary reports for budgets vs. actuals.
• GL008 – Pulls revenue and expense activity related to criteria search by the user, e.g. project id.
• GL061 – Pulls revenue and expense activity, cash balances, and outstanding balances owed, related to agency funds.
• GL062 – summarizes actuals and budgets for endowment principal and spending funds; identifies cash availability.
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Cognos Reports - Tips
Reports have transactional details and some include hyperlinks to journals for further detail when viewed in supportable formats. Users able to search through a combination of fund, department, project, account, and time period.
For Cognos upgrade information and training opportunities, please visit: https://www.it.northwestern.edu/admin-systems/announcements/cognos-upgrade.html
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Resources
Accounting Services functional areas and contact informationhttps://www.northwestern.edu/controller/accounting-services/services.html
Policies and procedureshttps://www.northwestern.edu/financial-operations/policies-procedures/index.html
Formshttps://www.northwestern.edu/financial-operations/policies-procedures/forms/index.html
General [email protected]
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Important Dates - Month Close
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Updated annually: https://www.northwestern.edu/controller/fiscal-year-end/fy19_closing-calendar_final.pdf
Important Dates - Fiscal Year End
• Chartfield requests approved by 8/31/19
• CATracks adjustments completed by 9/10/19
• Upload Journals received by 10AM 9/11/19
• Portal journals approved by 9/16/19
– Please be mindful of timing for any reinvestment, quasi additions, or other endowment journal requests
Fiscal Year End Calendar:
https://www.northwestern.edu/controller/fiscal-year-
end/index.html
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Questions?
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